Adequate housing hard to find near industrial zones

The study shows that single wage earner households in the City making US$179 per month must on average pay US$30.43-US$39.38 per month more than they can afford on basic housing costs and other necessities.

Thus, it is mandatory for both spouses of a family to work or other group living arrangements worked out just to pay the rent and put food on the table, says the Ministry of Construction (MoC).

The number of affordable and available rental units in the industrial zones of the City meets just 20% of the demand, Trịnh Truong Son, deputy head of the MoC told a recent housing committee in Hanoi.

The JICA study has borne out what those who work in housing policy have known for a long-time, said Mr Son, — that the majority of workers in the City’s industrial zones can’t afford the housing costs.

In addition, an on-the-ground examination of the homes reveals that most are in varying states of disrepair, he said.

Fixing the houses up to bring them to a liveable condition would require a substantial investment, he said, and in fact the cost of repairs would in many cases exceed the resulting value of the home.

The houses also lack access to key amenities such as being in close proximity to public transportation hubs, retail establishments, and good quality parks – that so many of us here in Hanoi take for granted.

Kenichi Hashimoto, head of the JICA research team that performed the study in turn emphasized that the inadequate housing situation is the primary cause that industrial zones are having trouble retaining skilled workers.

It’s critically important that a national workforce and housing initiative address the problem by creating new affordable homes in neighbourhoods located near the industrial zones of the City.

For his part, Nguyen Chi Hung, deputy chief of the Management Board of Industrial and Export Processing Zones favoured constructing new homes as opposed to renovating existing homes.

I recognize that any forward-thinking housing plan needs to create a balance between making a more significant investment in the development of new affordable homes and the preservation of existing homes, he said.

But due of the massive movement of workers to the industrial zones nationwide and the fact that it by far outstrips existing housing, we’ve already taken preliminary steps to begin a nationwide search for land to build new houses, he said.

Based on its study, JICA experts suggested a few measures to help develop better housing for workers including reducing interest rates for loans to below 5% and stretching out the amortization period for repayment to more than 20 years.

As the City struggles to spur equitable growth, the government must advance strategies that allow residents to benefit from the changes, the experts said, and improving the existing stock of affordable homes should be high on the list of top priorities.